BreadTalk's Q1 net profit up 22.2% to S$2.45m

BREADTALK Group's net profit rose 22.2 per cent year-on-year to S$2.45 million in the first quarter ended March 31, 2016.

Revenue rose 1.4 per cent to S$154.56 million. Its bakery division's revenue decreased 1.3 per cent to S$75.9 million, as the BreadTalk outlets in Singapore, Hong Kong and Malaysia experienced some degree of decline in same-store sales, partly offset by strength in Toast Box Shanghai and Beijing.

Its food atrium revenue declined 0.4 per cent to S$41.8 million.

In contrast, its restaurant division delivered 9.9 per cent revenue growth to S$36.9 million, riding on strong same-store sales growth, recovery at Ramen Play and higher contribution from Din Tai Fung Thailand.

Earnings per share stood at 0.87 Singapore cent in Q1 2016, compared to 0.71 cent in the corresponding period a year ago.

An interim special cash dividend of 1.35 Singapore cents per share was declared, following the divestment of 112 Katong, a non-core real estate investment. The dividend represents approximately 45 per cent of the divestment gain. It will be paid on July 4.

Looking ahead, BreadTalk said: "The financial performance of our bakery division is showing initial signs of recovery in line with our strategy to moderate the pace of outlet expansion and focus on the quality of earnings. Management will continue to place emphasis on extracting further productivity gains and higher returns from each of our existing outlets."

But it warned that the food atrium division faces a challenging environment, on the back of rising operating costs and stiffer competition - especially in China.

BreadTalk shares rose three Singapore cents or 2.63 per cent on Monday to close trading at S$1.17 apiece.